Govt overspending on poll-related projects to trigger inflation, bigger deficit

EXCESSIVE government spending for election-related projects will trigger inflation and higher deficit, Nacionalista Party senatorial bet Gwen Pimentel warned on Friday.

In a statement, Pimentel, a lawyer, cited a report by Finance Secretary Margarito Teves in a recent press briefing that the government had already incurred a P134.2-billion deficit in the first quarter, breaching the P110.9-billion limit and nearly half of the full-year target.

She noted that the deficit figure reported by Teves was bigger than the P119.7-billion gap recorded in the same three months last year.

“Our people will face more economic hardships, unemployment and slower economic growth if our government persists in overspending in an attempt to influence the results of the forthcoming elections,” she added.

Pimentel said expenditures for the period reached P400 billion, exceeding the ceiling by P22.8 billion, as the government spent heavily for various projects that, she said, were apparently intended to “boost the chances of the administration in influencing the results of the coming elections.”

She denounced the move as “highly irresponsible, contrary to public interest and possibly illegal, coming as it does during a crucial election period, when administration candidates are far behind in the race for election to public offices because of the unprecedented unpopularity of the administration.”

At the same time, Pimentel cited a separate report that the Arroyo administration was releasing government funds to local executives who are supporting the administration ticket “on some excuse or another to avoid the strict conditions of the election ban, like making up an emergency or some other.”

“We are facing the makings of a scandal bigger than the fertilizer scam in the 2004 elections, when nearly a billion pesos of government funds were distributed to administration officials and candidates to ensure the victory of the administration bets,” she said.

According to Pimentel, the excessive government spending for electioneering purposes would push up the prices of commodities beyond the reach of the common man.

She also noted that the Asian Development Bank and the Bangko Sentral ng Pilipinas have predicted the inflation rate this year could increase to 4.7 percent.

“However, because of the excessive spending, this might even go beyond 5 percent.”

Pimentel proposed a probe of government election spending and possible scams in order to prevent the same practice from recurring in future elections and to recommend the prosecution of those responsible.   –Butch Fernandez / Reporter, Businessmirror